OFFICE OF THE AlTORNEY GENERAL OF TEXAS 

AUSTIN 

Honorable George Xi. Sheppard 

Comptroller of Publia Aaoountrr 

Austin, Texas 

Dear Sir: 

on the r0ii0dng; 

tion at that 

-8evonth L 

perr0rm the oaring 

80 aoi&fxe the formason in thlcr State ongaged in the budnor 

rurioe or partormi~g kayduty for othenl 

(~1'01: oompenration, dth the nra of any 

llefioe, tool8, inetrumentcl or equipmenti, slaotrioal, 

meahanloal, or atherwlao, or by meaM et q ehemloal 

slsatrloal, or meohanlaal p~)oers, I&W! auoh ae%~l6e 18 

performed in oonnootion ti8h the osla@&tiBg of the oc~ine 

seat of any ~$1 or gas well a the rhootl.+g or aoi8ising 

the formations of nuoh well8 or the surveying or CastiM 

of the samb or other formationa of the Wth in ant muoh 
Eonorabla George H. Shoppub, p0ge 2 

011 br gas wella, ahall rapport 0~1 thp 20th 02 saoh lPonth 

and pag to the Comptroller, at his ~offioe in Austin, Tuaa, 

0n ooonpatl6.u tu equal to t- md tyo-tsntha (2.2) pa 

oant of the grqaa amount rotpite4 rrom aald,srrtioe turniahed or datg'periormed, during the oalendar month nut 

preoediag. The aald report ahall be ueouted under oath 

on a form preagrlbed and turnlahed by the Comptroller,* 

,I,, 

hel& that wthla la a tu on ~errloe 

." (Soa Attorn (hnudL*a Op! 

Q.) 

liiii 

The psraona~tu0tPare thoar 

of the aaaln% art 

0 

or other iornatlorm of the earth ti w.auoh 011 or 

gas wolla." 

It. la 0le0r that it 0ny &at& prrioiW:any .ot atid 

oprlr~tlona, %owl~, o emuitln or thc.'o*aing g l a a ,î ~ a heo tla g,î 

%oldlring;w ~~aofceyIcLg* or %~aOinl,l. and oolleeta money theraror, 

8aid~Rpon aa io+fz&+a-& 5 liability i0r the tug ,a@, r, bdleve 

it la al.80 aleai- that~ I? a p0raon prriorma ago other operation, 

uhloh oonafltutas a aerv100, that la "in oenneotlan with" me of 

aald named o$e5atlonr auoh l ertlor la bk~ao ta.xablo. Ia oth0r 

worda,an operatloq,doag not hara to 30 one or tha, mmed aprratlona 

to be taubls,~ but':it ii taxeble ii it ii moroll~ *pertorre@h 

the ncuaed oporatlona. 

oonneotlon wlth*'a broad 

yha oourta s 

lntor retiatldh.* 

Kokuaai Klaen Kabuahikl Uleha T.~ Colunbla Bteyedacr %g 60.~, 23 

Fed. Supp. 403. We be$lers that any l mlo r ,th t 1s perfozmod 

aa a neoeaatig atop;toward the prrfomoi of or in fulfillment 

OS, a partloular o sratlpm would bs oonaldero& a8 ba$ng dono 

'in oonneotlen wit'* ii riaid partioular operation. In the oaae of 

Ra br ld Oorporatlon of Oluater t. Rlahazdaon, (Sup. Ct. of 

F&.)'l&lngo. 113, the oourt said: 

"In the oam ncRT beior0ttbe00urt, tha rdtk 0n which 

'plaintifi ia shuvn to hare be&n employed, and pormlt80d Or 

aufrrred to eagags in, waa the proourtient o? a l upplr of 

raw materiel for the operation oi.doten~ant~a 8awmlJ.l. 

That work of that kind la to ba aonatrwd aa work 'a 

oonneotlon with' any nil1 ia fullp a@talnod by the authariI ltho &h,0uob work waa note @otually done ia the ril.l 

lttyor Gthln the ourt~lla&e theraof,~ P .* (Unduaoorlng 
t, 

i 

,Eonarabla Gaorga H. Shappard, pa&e 3 

ii 

YOU? firat Question depmda on the moaain~'~ tha 

hraaa win oonnootion w1hn.F In Attorney hneral’a Opinion 

P. 0-36Tt, v, we held that *perrarating,w as that oparatian 

la ?rdInarilg one and understood, doaa nofpeonatituta *ahoat 

and we also hold in *hat opinion, and wa noW hold, that the 83 '~ 

1' 

in question does not a 

pertorator,w bu% that I! 

ply to the ordinary use of a ameaha&aal 

t would apply it a Q~aohaniaal perforator* 

was used "Id oonaeotlon with? One of the taxable oparatlona. 

X.bda? what was aald in that Opinion, we 'ballera the aama ao 

would apply to *sun ~per?oiNtora * No Pddrratandthat ordiaully 

perforating ths aaaing la not d&q In a9nneotlF with a taxabla 

o 

Ii 

eratlon, 

t 

but la dona dalg for tha purpose or making hol@:r- la 

a easing so that the.011 already thera nil1 flow ,lnto the wall1 

but, aomatlmaa parSoratIng 1s gone in oonneotion with a tuabla 

operation. (‘See .*Pstrolewa Produotlan ,” by Wilbur F. Cloud 1937, 

paga 388; WELamanta~of th,a Potrolawa ladaatr~,*~edltad by i. ~8 

Golyar, 1940, page 229;,:-*,Vse of Oartiddt ifall Coraplation Y&Ma,* 

by George Webor; O~l~a:Gaa Journal (Maroh 17, 1938); and *Drllllng 

Oar Journal 

the atatuta. III the aaao you aek about the aarrloo of parforat%ain(r 

the oaaipg Ed dqne, as a nrwaaary utop .toward thd pu$armanoo o$ 

, 

aoldlzfng~tha.~~tlon.~..~,Xn fa,ot tha operator had the parioratlng 

ddno In or#or to .qoldlae eat that 1~01, and, from what fou have 

adrlaad UN, w*, uudrratand that this putloular parfOrmn& j@b 

was graparitorp $0 aold~ilng. we think th8 work 8s perforating 

the aaalng In this aa8a waa&ne "ln ~oonuaotlon with" aoldlaiag 

tha rccmatlon, tiloh Ia,a taxable operatim. Tharofore, our 

,$ anawar to your first question Iu that la the partleuhu oaaa 

rat, deabribe and ask about the work of psrfaafing tha oulag 'E,. la a taxable aenloe. 

Ua wl.ll~now~oonaldar your asa& quadlon,'whIah aani oerna tho use of a gun parrarator in an opa.hole. .Wa undaratand 

i that the gun pelTorator is lrrere4 iato tha wall to a lava1 balw 

.,:- .~i the oaalng and that bullets are tired $nto the farmatlon for the 

purpose of breaking u 

s 

the sandstone, limaatan~ Or at&r ubatanoe 

and opallng paaaagoa n the f ornation so as to stimulate the flaw 

41 011 into the wall. 

Aa heretofore IndIaabed, we believe that when l meahmloal perforator or a gpn perforator la used ln 108 ordinary mannor, 

not In aonneotlon with a named taxable oporatlon, auoh a aerrioo 

la pot taxable. The ordinary wnner of p erating a maohenlaal 

perforator or a gun pertarator is to use 9 t ln euttlng, pun+rug 

of ahootlng holes In a oaalng so that 011 outalda the oaalzq at 
Honorably Qeorge H. shoppaml, pago 4 

that lore1 aan flow through raid holer into the wall. Wo ara 

advised that the use of a gun parSOrator In an opa&??holo la 

very unusual. In Attornaj @aneral'a Opinion Ho. o-3627, 

we quoted from Vundamentala of the Petrolsum Industry,* 

Dorsey Hager, 1939, at page 235, as SOllows: 

"Shooting aooomplIahea aaveral pur oaaa, apsolflaally,lt 

'1. Breaks up the sandstones ar 1 L aatone@, oaualng 

ohannala to itim. 

"2. Opens passages to fracture zones or to joint 

plaui)~, in whloh 011 may oaour. 

"3. Forma a larger ool.loolsl.ng area. 

“4. Creates more seep-e apeoa in the hole. 

It throz ahanuels into the well.? 

Ozeates a vaau@m that suoka l?,the oil, starting 

In that opinion we duo quoted rraa the oaae of Texas Qamlto Oil 

~ompw T. ~illiarrm, 199 ag. ~6, 250 S.W. 818, as rouorar 

"It 1s a matter of ooamon knowledge that the ahoot5ag 

of 'an oil well la aona alwaia at a tia!e when tha wa&l la at 

or near oompletlon, or when the oil rand has been ruehad; 

tha purpoga being to looaeu the formttlon to tha and that 

the flor.or 011 MY be lnoreaamd.w. 

We ballera that by the ume of a gun perforator in an op+ hole, 

whereby bullets are fired into the formation, It aarrea’t 

Tudor the trrau of the statute *ah: 

# 

pupr: Exl~~~:~~:lo. 

lnp 

Our anawer to four aeoaud qwad ibn 18, 

that the firrag or bullota Into tha formatian or M oput hole 

at a ~lerel below the oaring Is a taxable aerrloa. 

We hope that the SoregoIng haa answerad pour quaatlma. 

Your0 rorf ~4Aly 

ATTORNEY Gl!X.BRAL OF TKXtW 

. 

APF’ROVED AUG?, 19&l 

,(slgned) GROVER SEILWS 

d) ““ILC;lGl~Zl 

Fir& Assistant Attorney General 

APPROVED OPIRION COMMITTEE 

By B.C. Ghalrmau 

O.K. G.R.D.